Motorola’s CFO David Devonshire is trying to lower expectations about the companies performance in the next few quarters, according to RCR Wireless. He described the next few quarters as “rocky”, and clarified that as: “We’ve said that earnings, because of gross-margin compression in mobile devices in the fourth quarter, would not turn around in the first quarter. That’s why I refer to it as ‘rocky’.” The handset giant will focus more on profitability, although tried to indicate this wouldn’t come at the expense of marketshare. It will also start buying chipsets from Qualcomm and Texas Instruments after problems with the supply of 3G chipsets from Freescale Semiconductor hampered its business in Europe.
Motorola got a big boost with the Razr phone, but that advantage is largely gone as other manufacturers copied the successful design and the phone became more out-of-date. One handset does not make a successful manufacturer, no matter how many it sells, something that new entrants like Apple would do well to learn sooner rather than later.